For the first time in years, this summer looked promising for Alberta’s hog industry. Then a drought hit.
Pork was more expensive last spring, but June’s heatwave roasted crops that are frequently used for pig feed, such as wheat and barley, and feed prices skyrocketed.
“It’s at an all-time high,” said Ard Bonthuis, a pig farmer of 16 years who owns Porkdale Farms, east of Taber, Alta., in southern Alberta.
Pork prices remain strong, but higher feed costs mean the pay bump counts for little.
Pig producers only get a small cut of profit from pork sales, while retailers take home a much larger piece of the pie, said Brent Bushell, manager of Western Hog Exchange, a non-profit that helps producers market hogs for slaughter.
The pork industry has been in a rough patch for the past five years, with many hog producers losing money yearly at approximately $11 per pig.
“The industry is in a severe crisis,” he said.
“We have to get a better balance.”
The problem, Bushell said, is Alberta hog producers have little negotiating power with meat packers as the province has an open market system.
Quebec, in comparison, has a single-desk marketing system, where producers and packers are legally mandated to negotiate a new pricing structure every two to five years.
“They have probably the fairest way of sharing the value of pork in all of Canada,” said Bushell.
Alberta dismantled its own single-desk marketing system in the 1990s.
Hog producers usually only turn profits about four months of the year: barbecue season, before demand drops and prices fall during the winter, said Darcy Fitzgerald, executive director of Alberta Pork, a non-profit organization representing the province’s registered hog producers.
For long-term sustainability, profits should be more equally shared between producers, meat packers and retailers, especially since costs are rising for farmers, Fitzgerald said.
“It doesn’t mean you have to pay more as the consumer. It just means that the money you’re paying already needs to be fairly shared.”
Drought the ‘straw that’s broken the camel’s back’
Canada is one of the largest exporters of pork in the world. The industry exported $4 billion dollars worth of pork around the world, according to stats from Canada Pork International, the export promotion agency of the Canadian pork industry.
Beef exports, meanwhile, totalled just over $3 billion the same year, according to the Canadian Cattlemen’s Association, a non-profit representing 60,000 beef farms and feedlots.
Demand for Canadian pork has surged recently as China, the world’s largest pork consumer and producer, lost millions of pigs to African swine fever.
Alberta is the fourth largest producer for hogs in the country. Pork production in the province has grown slightly over the past five years, but hog producers are fleeing the province due to few profits and high costs, said Bushell.
The pork industry was already in trouble, but the drought made things worse, he said.
“It’s the straw that’s broken the camel’s back.”
Bonthuis, the pig farmer in southern Alberta, says he’s going to stick it out as long as possible.
“I always think at the end of the day it’ll work out,” he said. “But maybe I’m too optimistic.”
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Radio Active6:22The summer’s drought has pig-feed prices sizzling